Amadeus Increases Its Market Share

by Michele McDonald

Amadeus’ GDS market share continued to grow in 2014, to 40.7%, and in the fourth quarter, to 42%. The fourth-quarter boost came from the migration of South Korea’s Topas distribution system to the Amadeus platform.

In a call with analysts, CEO Luis Maroto said he expects continued market share growth this year, particularly in the U.S., its fastest growing region. It began transacting some of Orbitz’s business in January.

Amadeus’ travel agency air bookings increased from 443.4 million in 2013 to 466.5 million in 2014, an increase of 5.2%. Air bookings by the GDS industry as a whole increased 3.2% in 2014, Maroto said.

Agency air bookings increased 14.6% in North America and 13.2% in the Asia Pacific region. That growth more than offset declines of 2.3% in central, eastern and southern Europe and of 3% in Latin America.

Turf war
A bit of a turf war is being waged in Europe, where Sabre is pushing hard to take business away from Amadeus.

But Maroto took a “win some, lose some” attitude toward Sabre’s gains.

“We compete,” he said. And while agency incentives and signing bonuses play a role in that competition, they are “not the only consideration” for agencies that move to a new system, he said.

Meanwhile, the average booking fee paid by airlines increased by 2.1% in 2014, to €4.02 ($4.50), due to a “positive booking mix,” Ana de Pro, chief financial officer, said.

Amadeus continues to make significant investments in research and development. In 2014, its investment increased 5.3%, to €527.1 million (about $590.1 million), or about 15.8% of its revenue.

New agreements
During the year, Amadeus signed new distribution agreements with 15 hybrid and low-cost carriers, bringing its roster of LCCs to 79. Bookings from travel agencies on low-cost carriers were up by 16% year-over-year during 2014.

Amadeus also signed 31 new airlines to its Airline Ancillary Services solution during 2014, for a total of 110, including Etihad Airways and United Airlines.

In addition, 14 airlines signed agreements for the Amadeus Fare Family Solution, taking the total to 15.

During the call, Maroto said Amadeus is “building a platform on the payment front,” but he added that the focus will differ somewhat from Travelport’s eNett International payment solution. “The opportunity is there,” he said.

Maroto also said he’s happy with the progress that is being made on Amadeus’ rail platform.

Amadeus reported net income of €681.1 million ($762.5 million), an increase of 9.9%, for 2014. Revenue for the year increased 10.1%, to €3.42 billion ($3.8 billion).

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